Recently, SL Green Realty Corp. SLG extended its 15-year lease with The Carlyle Group CG at its New York City property — One Vanderbilt. Per the extension, the global investment firm will now occupy an additional 32,592-square-foot space on the entire 35th floor of the office tower.
With this lease’s expansion, The Carlyle Group will now own 127,744 square feet of space across floors 35 through 38 on the 1,401-foot East Midtown property. This trophy tower, which has reached the 73rd floor since its ground breaking in 2016, is slated for an opening in 2020.
SL Green is likely to witness decent demand for space at this property for its superior positioning and amenities. In fact, One Vanderbilt is anticipated to achieve both LEED Gold under version 4.0 and WELL certifications. It will cater several amenities to its tenants, including a 30,000-square-foot tenant-only amenity floor, with large format meeting spaces, a club-style lounge and an outdoor terrace.
This apart, the property also enjoys proximity to the Grand Central Terminal, giving it easy access to the nearest transit network. SL Green plans to invest $220 million in private funds in a bid to augment this transit system.
Apart from The Carlyle Group, a number of reputed firms from the financial, banking and legal industries have entered into lease deals for occupying space in this property. Some of its tenants include TD Securities, a leading banking and investment group, MFA Financial MFA, a publicly-traded real estate investment trust, as well as law firm Greenberg Traurig, and German financial firms DZ and DVB Banks.
Notably, SL Green possesses premium office properties and a varied tenant base, along with a solid balance sheet. Further, the company is divesting its non-core assets, and using the proceeds to fund share buybacks and development projects. However, intense competition from other market players limits the company’s pricing power.
SL Green currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.
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